Larry Summers has never been willing to settle for second-best. Hismother likes to tell the story of driving him to a game of tennis at the age of 12, calling out after him: ‘‘Good luck!” The boy turned around, looked at her coldly and said: ‘‘Mom, this isn’t about luck. It’s about winning.”

Barack Obama will be hoping that Summers brings some of that can-do spirit to his new job as director of the National Economic Council (NEC), the White House agency that monitors the president’s economic agenda. On the face of it, the appointment looks like aminor snub to the man who had been widely tipped to return to the cabinet position of treasury secretary, which he held for the last 18 months of the Clinton administration. Instead, Obama has given that job to Timothy Geithner, a former protege of Summers who currently serves as chairman of the New York Federal Reserve.

On a deeper level, however, this may well be another example of the good cop, bad cop management model that saw the cool-headed Obama choose the tempestuous Rahm Emanuel as his chief of staff. Smooth, courteous and even-tempered, Geithner will be the public face of the new administration’s economic team. Behind the scenes, however, the more pugnacious Summers is likely to be the president’s most influential financial adviser. With his own office in the West Wing, he will have his fingers in every pie going in or out of the Oval Office.

Described by Obama last week as ‘‘one of the great economic minds of the age’’, Summers has been angling for a return to the White House for some time. Over the last two years, he has acted as an unofficial Democratic spokesman for finance, excoriating the Bush administration’s reckless spending and appearing on every major talk show to promote alternative policies.

Last December, when officials at the Federal Reserve were still insisting that a recession was unlikely, Summers gave a speech in which he said it was ‘‘distinctly possible we’re headed into a period of the worst economic performance since the stagflation of the late 1970s and recessions of the early 1980s’’. For all his undoubted ability, however, there’s no great mystery about why Obama might have concluded that Summers was best suited to a backroom role. Even his greatest admirers describe him as a prickly egotist and an overbearing bully who is incapable of hiding his contempt for people he considers to be his intellectual inferiors.

There are numerous stories about his propensity for lecturing members of Congress like imbeciles, rolling his eyes at meetings and throwing drafts of speeches at his staff in contempt. In a not untypical comment, Wall Street Journal columnist Paul Gigot wrote in 1995 that ‘‘Larry Summers is to humility what Madonna is to chastity’’. An academic by training, who is often contemptuous of career politicians, Summers cuts an incongruous figure in Washington’s corridors of power. Although he has reluctantly learned to wear the pinstripe suits that hide a middle-aged paunch, he has often been seen wandering around with his shirt-tails hanging out of his trousers.He guzzles Diet Coke from morning to night, and keeps an entire fridge full of the soft drink in his office.

Summers made his name in the 1980s as a leader of the new Keynesians, a band of young professors dedicated to upholding the ideas of the British economist who argued that government could be a force for good. His basic philosophy was that markets work best when left alone, but that intervention was fully warranted in times of crisis, such as now. ‘‘Government has a place,” he likes to say, ‘‘but it also has to know its place.”

Throughout his career, Summers has been an advocate of using government to soften the harsher edges of capitalism, a prime example of which came when he successfully encouraged former president Clinton to cancel the official debts of some of the world’s poorest countries.As a well-known supporter of free trade, his appointment should also reassure those who fear that the US will shift slowly toward an inward-looking policy of protecting jobs at home and penalizing American firms who outsource jobs abroad. Although he has been a loyal Democrat all his life (unlike Geithner, who was once a Republican and is now a registered independent), Summers vigorously denies any suggestions that he is an ideologue who refuses to listen to opposing points of view. ‘‘Life is about probabilities,” he said in a recent interview. ‘‘You can’t go around saying, ‘I’m sure of this, I’m sure of that’. You make decisions that you think are, on balance, the correct ones, but you must always bear in mind that they might turn out to be wrong.”

It’s an attitude that will be put to the ultimate test by the Obama administration’s first major initiative - a stimulus rescue package that could cost up to $1 trillion. Lawrence Henry Summers has some of the best financial genes in the world. Born on this day in 1954 and raised in Philadelphia, he is the eldest son of two economics professors and the nephew of Professor Paul Samuelson, a Nobel prize winner who wrote a standard textbook on the subject.

Economics was such a large part of the young Larry’s upbringing that his father, Robert, would auction off control of the house television set among members of his family.Whenever his parents went out for dinner, they would leave a mathematics puzzle for their precocious son to solve.By the age of 11, he had devised a logarithm to determine whether a baseball team’s standing on July 4 could accurately predict whether or not they were going to win the World Series.

Despite this pedigree, Summers says he felt no pressure to go into the family business, and originally wanted to study physics instead.He eventually switched to economics because he decided it would have more relevance to the real world.He entered the Massachusetts Institute of Technology at 16, received his PhD from Harvard and, at 28, became the youngest tenured professor in the university’s history. Around this time, Summers got his first taste of Washington politics when the Reagan administration invited him to serve on the White House’s Council of Economic Advisers.He stayed tenmonths, just long enough to realise that he profoundly disagreed with the Republican philosophy of trickle-down economics.

Convinced that government should do more to help the poor, Summers went to work for the then governor of Massachusetts, Michael ‘The Duke’ Dukakis, and helped to pioneer the welfare-to-work schemes that became known as the ‘Massachusetts Miracle’. He became the senior economic guru behind the Duke’s presidential campaign in 1988, insisting that the same policies could work on the national stage. After securing the Democratic nomination, however, Dukakis performed feebly in the general election and lost heavily to George Bush senior.

Depressed by this reversal, Summers took up a new position as chief economist at the World Bank, where he specialised in lending to poor countries and the needs of emerging east Asian economies.He pushed market-oriented development policies, championed the need for privatising state-owned enterprises and was a tireless advocate of investing more funds to educate young girls.

However, his tenure at the World Bank is probably best remembered for the embarrassing episode of the ‘toxic memo’, an internal document he approved in 1991 about the economic efficiency of dumping toxic waste. ‘‘I think the economic logic behind dumping a load of toxic waste in the lowest-wage country is impeccable,” he wrote, adding that ‘‘I’ve always thought that under-populated countries in Africa are vastly under-polluted compared with Los Angeles or Mexico City’’.

The memo was leaked to the Economist magazine and Summers quickly apologised, insisting that he had intended it as a ‘‘sardonic counterpoint’’ to muddled thinking in the debate about environmental policies in the developing world.One of the people most offended was Al Gore, then just a senator for Tennessee but already a prominent environmentalist. The toxic memo is thought to be the major reason why Summers landed only the relatively lowly position of under-secretary for international affairs at the treasury when Gore was elected vice-president on Clinton’s ticket in 1992.

Once inside the White House, however, Summers’ chutzpah quickly made him one of Clinton’s most valued troubleshooters. He played a crucial role in organising IMF rescue packages for two of the biggest international financial episodes of the 1990s - the collapse of the Mexican peso and the Asian financial crisis. He was promoted to deputy secretary of the treasury in 1995 and succeeded to the top job four years later.He also formed a close relationship with then Federal Reserve chairman AlanGreenspan,with the twomen reportedly swapping jokes about interest rate yield curves during their regular jousts on the tennis court.

Summers’ brief reign at the treasury coincided with an economic boom, and he would almost certainly have retained his position had Gore won the 2000 election. Instead, he was forced to leave politics temporarily, handing over a record budget surplus to incoming president George W Bush. A couple of months later, he became president of his alma mater Harvard University, after a secretive selection process that, at one stage, included Clinton and Gore themselves.

Before long, however, Summers’ abrasive personality had landed him in trouble again.He criticised the university’s teachers for ‘‘grade inflation’’, pointing out that half of all undergraduates were being awarded As. He told Cornel West, a black professor in the African-American studies department who had become a media star, that he needed to do more academic work. To top it all off, he used a conference speech in January 2005 to suggest that the scarcity of female scientists and engineers might be caused by innate differences between the sexes. The resulting furore briefly made Summers one of the most controversial public figures in the country, with one biologist who stormed out declaring that she was so offended by his attitude, she could hardly breathe.

Although Summers vigorously protested that he had only been advancing a theory, the damage was done and he was eventually forced to resign his position. Today, he diplomatically calls the incident ‘‘a monumental act of imprudence’’, adding that Harvard’s loss has been Obama’s gain. His new role means that he will be able to offer his policy prescriptions to the new president without having to run a federal bureaucracy where tact or diplomacy might be required. It also means that he will not have to undergo confirmation hearings in the Senate - a process that could have been embarrassing, given his history of impetuous statements.

Married to English professor Dr Elisa New since 2005, Summers has three grown-up children by his first wife Victoria. He takes skiing holidays every winter and is still an enthusiastic tennis player, joking that his game is ‘‘much better than my physique might lead you to believe’’. He contracted Hodgkin’s disease in the early 1980s and underwent nine months of chemotherapy to fight the cancer, which has been in remission ever since.

As the US faces into its worst financial crisis in living memory, president-elect Obama spent much of last week reassuring Americans that ‘‘help is on the way’’. It is now up to Summers to prove that he can be the right man for all economic seasons.